What is the difference between tax accounting and financial accounting at the accounting office?
In running a business, it is necessary to establish an accounting and financial management system for each business. Bookkeeping is considered an important standard principle and often times business operators and businesses do not have knowledge about tax management or finance and accounting, which causes them to violate tax laws. Therefore, today we will explain the difference between financial accounting and tax accounting. First of all, you must understand that accounting can be divided into many types and in the accounting office according to
The Accounting Profession Act 2004 defines accounting into 6 areas:
1. Accounting
2. Accounting examination
3. Management accounting
4. Setting up the accounting system
5. Tax accounting
6. Education and accounting technology
Symptom tax is
Tax refers to what the government compulsorily collects money or profits from the people that arise from the income that people conduct businesses or businesses every year. for the government to use for the benefit of society nation in development without any direct compensation to the taxpayer. Every citizen is responsible for paying taxes.
Financial accounts are
Financial accounting is accounting that tracks every financial transaction of a company or store business or is an accounting of income, expenses, including cash that is under the accounting principles of the company or store, such as the profit and loss statement or the balance sheet of the company.
Difference between tax accounting and financial accounting
Tax accounting
Tax accounting It is an accounting standard that brings accounting principles to adapt to the Revenue Code and tax laws in order to calculate net profits and losses. Conditions for recognizing income and expenses for VAT Personal income tax, withholding tax, is an adjustment of accounting principles to be in line with tax laws. Find an accounting solution to comply with taxes. Improve accounting records to be appropriate and correct according to tax laws. Do accounting as required by tax law, such as submitting taxes and reporting VAT. Adjust accounting income to match taxes correctly.
financial accounting
Financial accounting is accounting to present financial status information. Business results and financial changes of the business To report results to executives, outsiders, or in government departments, whether it be cost accounts, balance sheets, cash flow statements, and details of all financial transactions. It helps to control income, expenses, debt and owner’s equity. Helps in the correct management of the business. Helps in deciding on operations to expand the business. or cancel the business For the benefit of outsiders such as shareholders who want to use operating results information to make decisions. Evidence proves the accuracy of accounting and the collection of financial accounting data to detect fraud as well.
Most accounting firms may have the knowledge. May only have knowledge of financial accounting. Or there may be very little knowledge about taxes. In order to understand in the same direction, both ways of doing taxes need to be as consistent as possible for accuracy and compliance with legal requirements
